SSB 1106 (LSB 2000XC (2) 90)

SENATE FILE _____ 

BY  (PROPOSED COMMITTEE ON HEALTH AND HUMAN SERVICES BILL BY CHAIRPERSON EDLER)

A BILL FOR

An Act prohibiting employers from requiring certain mental health professionals to enter into noncompete agreements and including effective date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  NEW SECTION.  147.164  Mental health professionals —— noncompete agreements prohibited.
   1.  As used in this section, unless the context otherwise requires:
   a.  “Confidentiality agreement” means an agreement between an employer and an employee by which the employee agrees not to disclose specified information designated by the employer as confidential.
   b.  “Mental health professional” means the same as defined in section 228.1, and includes all of the following:
   (1)  Individuals who are completing their supervisory requirement under a temporary license.
   (2)  Licensed master social workers with a current and active supervision plan on file with the board of social work.
   c.  (1)  “Noncompete agreement” means an agreement between an employer and an employee that restricts the employee from performing any of the following:
   (a)  Work for a different employer for a specified period of time.
   (b)  Work in a specified geographical area.
   (c)  Work for a different employer that is similar to the employee’s work for the employer who is a party to the agreement.
   (2)  “Noncompete agreement” does not include any of the following:
   (a)  A nonsolicitation agreement.
   (b)  A confidentiality agreement.
   (c)  An agreement prohibiting use or disclosure of trade secrets or inventions.
   d.  “Nonsolicitation agreement” means an agreement between an employer and an employee that prohibits solicitation by the employee, upon termination of employment, of any of the following:
   (1)  An employee of the employer to leave employment by the employer.
   (2)  A customer of the employer to cease or reduce the extent to which the customer does business with the employer.
   2.  An employer shall not require a mental health provider to enter into a noncompete agreement.
   3.  A mental health professional subject to a noncompete agreement who seeks a civil remedy to invalidate the agreement shall be awarded court costs and attorney fees to be paid by the employer enforcing the agreement.
   4.  A noncompete agreement entered into, or the renewal of an existing agreement between, an employer and a mental health professional on or after the effective date of this Act shall be void and unenforceable.
    Sec. 2.  EFFECTIVE DATE.  This Act, being deemed of immediate importance, takes effect upon enactment.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill prohibits an employer from requiring a mental health professional to enter into a noncompete agreement. The bill defines “mental health professional” and “noncompete agreement”.
   The bill provides that a mental health professional subject to a noncompete agreement who seeks a civil remedy to invalidate the agreement shall be awarded court costs and attorney fees to be paid by the employer enforcing the agreement.
   A noncompete agreement entered into, or the renewal of an existing agreement between, an employer and a mental health professional on or after the effective date of the bill shall be void and unenforceable.
   The bill takes effect upon enactment.